Gunvor Withdraws $22 Billion Lukoil Acquisition Amid U.S. Sanctions and Kremlin Puppet Label

Swiss commodities trader Gunvor has retracted its $22 billion proposal to acquire the foreign assets of Russia’s Lukoil following a warning from the U.S. Treasury Department, which indicated it would obstruct the transaction and labeled Gunvor a «Kremlin puppet.»

On Thursday, the Treasury stated that the U.S. would «never» authorize a license for Gunvor to manage Lukoil’s assets, as long as Russian President Vladimir Putin continues «the senseless killings» in Ukraine.

Gunvor responded by calling the Treasury’s statements «fundamentally misinformed and false,» asserting that it has been distancing itself from Russian oil trade for over a decade, has divested its Russian holdings, and publicly condemned the conflict in Ukraine.

Despite this, the company informed Politico Europe that it would withdraw its bid “for the time being.”

Last week, Lukoil, the largest private oil company in Russia, had accepted Gunvor’s offer after new U.S. sanctions prohibited the firm from operating internationally starting November 21.

The Treasury’s move to derail what would have marked Gunvor’s biggest acquisition leaves the status of Lukoil’s global operations up in the air.

The prospective deal encompassed Lukoil’s international assets, including refineries in Bulgaria and Romania, a network of about 2,000 gas stations in Europe and the U.S., and oil and gas projects in Kazakhstan, Iraq, Mexico, and Uzbekistan. The Financial Times valued these assets at approximately $22 billion.

In light of the U.S. blocking the transaction, Kremlin spokesperson Dmitry Peskov told business publication RBC that the divestiture of Lukoil’s assets and peace talks with Ukraine should be viewed as separate matters.

“We believe the legitimate interests of such large international companies, including a Russian one like Lukoil, must be respected in the context of international and economic relations. Such actions are unacceptable and undermine the global trading system,” Peskov remarked.

The U.S. sanctions package also targeted state-owned energy company Rosneft.

Lukoil has not issued a statement regarding the failed deal.

Gunvor, established in 2000 by Swedish entrepreneur Torbjörn Törnqvist and Russian oligarch Gennady Timchenko, was once the largest exporter of Russian crude oil.

Timchenko, a close associate of Putin, sold his 43.6% stake in 2014 just ahead of U.S. sanctions imposed following Russia’s annexation of Crimea. At that time, the Treasury alleged that Putin had “investments in Gunvor,” a claim that the company has consistently denied.